Homeowners in default receive so many phone calls, people knocking on their doors and letters that it can reach the point of harassment.  Some of these offers for help are legitimate but many (most) are not.  For the average homeowner it is next to impossible to tell who is on the level and who is not.  In Part I of Ventura County Fights Back...Stopping the Real Estate Scammers I told you that scammers do not look or act dastardly.  This was a theme repeated over and over by all three panelists.  Scammers are charming.  They are mothers, fathers, church goers, and often people you know and trust.  More appalling to the audience was they could be a real estate agent-even the agent you used to purchase your home.

If you understand the real estate laws that apply to homeowners in default it becomes a lot easier to sort out the genuine offers of help from those who seek to take advantage of you.  Stella Ling, with the California Association of REALTORS, (C.A.R.) went over the Foreclosure Consultant Law.  This law is designed to offer protection to owners of properties (1 to 4 units) that are in default from people or companies providing foreclosure related services for compensation.  Licensed real estate agents are generally exempt from this law but there are there are some guidelines.  If a real estate agents is doing something outside of what they usually do in the course of a real estate transaction the law may apply.

• A real estate agent cannot acquire an interest in the property.
• If the agent makes a direct loan to stop the foreclosure, the law applies.
• If an agent charges an in advance for services, they must get the contract preapproved by the California Department of Real Estate.  (Stella says noone, to her knowledge, has this type contract approved, so if an agent asks you for an advance fee, chances are almost 100% that they are breaking the law.)

For foreclosure consultants that are not real estate licensees, some of the requirements are:

• Written contract with a 3 day right to rescind.
• Consultant cannot acquire interest in property.
• No money can be paid until services are fully performed.

To be safe, don't sign anything without getting a second opinion from an appropriate and qualified professional.  Ask for proof of results and references.  And most importantly, always remember that if it sounds too good to be true it probably is.

We were told about an excellent video on Real Estate Scams published by FreddieMac on YouTube to help educate the public.  You can view it here.

Miles Weiss, Senior Deputy District Attorney in charge of the Real Estate Fraud Unit here in Ventura County told the audience about some of the scams that are happening right here in the county.  Scammers are promising loan modifications and charging upfront fees without any results.  Miles says there is about 0% change of them being able to deliver results.  Another scam involves deeding a 1/8 interest to a shell company that will file for bankruptcy to forestall the foreclosure.  The county recorder is sending his unit any such suspicious documents for investigation.  He encouraged the audience to report any suspicious activity to his office by visiting the Ventura County District Attorney website and filling out a real estate fraud complaint form. 

Miles acknowledged that the problem is huge and he and his staff have limited resources.  As such, they go after the most serious cases first.  It is still important to report all suspected real estate fraud even if the DA is aware of it since you may be the one to supply the missing piece of information that solidifies the case.

To wrap things up, Miles talked about another class of victims; renters.  Real estate scammers often rent out homes that are in the tail end of foreclosure.  They collect deposits and rent without disclosing that information.  Then the bank forecloses and the renters are out on the street having lost all the money they paid to the scammers.  These types of scams are proliferating on sites like Craigslist, so be careful and do your home homework.  

This article is intended to give you a general overview of the problem but cannot address everything that might apply to an individual situation.  Always consult an appropriate professional.  If you have any specific questions, call or email me.

Scam artists do not look or act dastardly. In fact, they are nice friendly people who seem trustworthy. They are well dressed, look nice and are genuinely likable. This was the message that Stella Ling, senior council with the California Association of Realtors (C.A.R.) had for the audience of the REFAT Industry Outreach Foreclosure Scams Forum hosted by the Ventura County Real Estate Advisory Team (REFAT) at the River Ridge Marriott in Oxnard. Panelists included Anne Lanphar, Vice President and Associate Senior Underwriter for First American Title Company, and Miles Weiss, Ventura County Deputy District Attorney.

I attended the forum along with many other worried Ventura County real estate professionals who are concerned about real estate fraud that seems to be epidemic. Everyone was hoping to learn more on how to identify and combat the problem. Ling says any homeowner in foreclosure is under tremendous stress. The weak, elderly, and people with language barriers make prime targets for scammers. People in default have fewer resources to fight the scammers back.

The first step in the foreclosure process is the Notice of Default (NOD) and in her opinion, this is like a big billboard saying, "Come and get me scammers." Actually that was in the old days-now it's an instant email blast to the defrauders. To illustrate this point she told us the story of Martha Rodriguez who located victim homeowners through computerized databases that list homes going into foreclosure. She would promise homeowners to refinance their homes with a co-signer who had good credit to stop foreclosure and save the home. Instead of refinancing, Rodriguez and the others submitted loan applications in the names of straw buyers. These loan applications (which contained false information) let them get loans from lenders that otherwise would never have been obtainable. The loan proceeds were used to pay off the loan in default and the remaining proceeds were skimmed off by Rodriguez and her cohorts. Even though the homeowners were promised that they would keep their homes, they lost title. The straw buyers didn't make payments on the new loans and they went into default.

Other common scams Ling shared with us were offers to stop foreclosure for an upfront fee of $1,000 (or much more). These schemes often included placing a lien on property or transferring title to facilitate a refinance from a borrower with a better credit score and a promise to sell the house back to them.

Anne Lanphar, with First American Title, shared what title companies look for in trying to combat fraud. She identified the following red flags that are common elements of problem transactions:

• Escrow has no contact with seller.
• Someone signing for the seller using a Power or Attorney.
• Buyer is buying home subject to existing loan.
• Seller to remain in property.
• Repurchase options for seller.
• Usually high level of fees.
• Someone assisting borrower.
• Large payments to 3rd parties.
• Same notary on buyers loan documents and seller's grant deed.
• Seller transferring property into a trust (other than a family trust.)
• Purchase price way below market value.

It is in the best interest of Title and Escrow companies to be vigilant. The goal is to stop these kinds of scams before they get started.

(To be continued in Part II)

Right now we're in the middle of a real estate market where buyers are getting great deals not only on homes, but on the financing as well. Never in recent years have there been as many great choices of homes for sale as there are today. Gone for now are the days when you had just a handful of homes to chose from and just two choices: take it or leave it. Then you had to battle it out with other buyers and ended up settling for a home you weren't crazy about. There is a terrific selection and you can find a home you'll be in love with for years to come. For first-time home buyers the news is even better. There are below market loans from the California Housing Finance Agency (CalHFA) that are available for first time buyers (which includes anyone who hasn't owned a home for at least 3 years.) In Ventura County, CalHFA will loan on brand new and resale homes priced up to $729,750 and new homes in targeted census tracts can be as high as $784,282. This is a huge deal because just a few years ago the maximum purchase prices allowed could barely get you a starter condo.

CalHFA offers the kind of loans that won't get you in trouble like the subprime loans you've read about. These are 30, 35, or 40 year low-interest, fixed rate loans. No variable rates and no surprise increases in your payment to worry about. There are even programs to help with closing costs and down payment assistance. If you work for the public school system there are even more advantages.

So what's the catch? Well, there are limitations on how much income you can make and just like the old days, there is a bit more paperwork (and time) involved so you'll need at least a 45 day escrow period, but that's pretty much it.

Visit www.calhfa.com on the web to learn more and find a list of approved local lenders. Or better yet, sent me an email and I can refer you to a lender who specializes in first-time buyers.

Ventura County Officials Unveil Updated Display Case in the State Capitol

Sacramento - Strolling down the hall in the first floor of the State Capitol, one will notice hundreds of curious visitors gazing at glass cases lining the walls. For Capitol veterans who stroll down these halls everyday, this is just another day in the State Capitol, but for other Californians, it is the excitement at seeing their home county on display.

The display cases lining the walls contain an exhibit of each California county, depicting the best of what each has to offer. However, some displays are out of date and haven't been updated for many years. They don't accurately reflect the beauty of their respective counties. That is why Assemblymember Pedro Nava recently joined Ventura County Supervisor Kathy Long, Lynn Suter (Ventura County advocate in Sacramento), and guests in the State Capitol to unveil, with much pride, Ventura County's display case. "It is always an honor to showcase and promote Ventura and Santa Barbara counties in the work that I do in Sacramento. Ventura County has created an exhibit that will be here to stay for the millions of visitors to admire for years to come," said Assemblymember Nava.

The new display is a stunning tribute to Ventura County and it includes photos by acclaimed home town photographers Tim Huaf and Joe Virnig, brief histories of our communities, and historical photos from the Ventura County Museum of History and Art. Special thanks to Ventura County business owners Chris and Laura Meissner who made the generous donation to the county that enabled the display to become a reality.